Property Tax: Commercial

Notices of Assessment are mailed each year on or before July 1st to all taxpayers regardless of whether the Board of Assessors increased, decreased, or left your property’s value the same from the previous year. You have forty-five (45) days from the date the Notice of Assessment is mailed to file an appeal with the Board of Assessors. When you file your tax appeal, you will have various decisions to make, which can be complicated. These decisions can have unforeseen impacts on your ultimate tax savings. See the Property Tax FAQ below, or contact The Hillis Firm today for more information on your commercial property tax appeal.

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What are the grounds for a tax appeal?

You may appeal your assessment on the grounds of taxability, uniformity of assessment, and improper valuation. O.C.G.A. §48-5-311(e).

Taxability: the determination of whether your property is subject to ad valorem property tax. See O.C.G.A. § 48-5-41 for a list of exemptions.

Uniformity of Assessment: the Board of Assessors has an obligation to ensure all values for tax purposes as between the individual taxpayers are fairly and justly equalized so that each taxpayer shall pay as nearly as possible only such taxpayer’s proportionate share of taxes. O.C.G.A. § 48-5-306; Thorpe v. Benham, 161 Ga. App. 116 (1982).

Valuation: the amount a knowledgeable, willing buyer would pay for the property and a willing seller would accept for the property at an arm’s length bona fide sale [definition below]. In determining the fair market value of real property, the following is considered: (1) the existing zoning of the property, (2) the existing use of the property, (3) the existing covenants or restrictions in a deed dedicating the property to a particular use, and (4) any other factors deemed pertinent in arriving at fair market value, including the “highest and best use” of the property. O.C.G.A. § 48-5-2; Sibley v. Cobb Co. Board of Tax Assessors, 171 Ga. App. 65 (1984).

What is the process for a residential tax appeal?

The Board of Assessors will mail a Notice of Assessment to you each year on or before July 1st. You then have 45 days from the date of the Notice of Assessment to file your appeal. The Board of Assessors will then review your appeal. This initial review often takes a significant amount of time, e.g. O.C.G.A. 48-5-311 allows the Board of Assessors 180 days for their review, plus additional time based on the number appeals filed. O.C.G.A. §48-5-311(e)(2)(A).

If changes or corrections are made to your assessment by the Board of Assessors, they will send you a “30 Day Change Letter.” If the changes are acceptable, you need to do nothing further except pay your temporary tax bill. However, if you remain unsatisfied with the Board of Assessor’s alternative assessment, you must notify the Board of Assessors within 30 days of the date of mailing the 30 Day Change Letter to continue your appeal to the Board of Equalization. The Board of Assessors will then forward your appeal file to the Board of Equalization. O.C.G.A. § 48-5-311(e)(2)(C).

If no changes are made by the Board of Assessors to your assessment, they will send you a written “No Change Letter” and automatically forward your appeal on to the Board of Equalization. O.C.G.A. § 48-5-311(e)(2)(B).

After your appeal is forwarded to the Board of Equalization, within 15 days of receipt of your appeal, the Board of Equalization will set a hearing date and send you a notification with the date and time. O.C.G.A. § 48-5-311(e)(6)(A).

At the Board of Equalization hearing you may present evidence and witnesses. You may also cross-examine the appraiser defending the Board of Assessors’ assessment. The Board of Equalization will then deliberate and render a decision. The Board of Equalization will put its decision in writing and hand deliver it to each party. O.C.G.A. § 48-5-311(e)(6)(D).

If you property is assessed at more than $750,000, you have the right for your appeal to be heard by a Hearing Officer instead of the Board of Equalization. O.C.G.A. § 48-5-311(e)(1)(A)(iii) and (e.1)(1)(A). Hearing Officers are state certified general real property appraisers or state certified residential real property appraisers as classified by the Georgia Real Estate Commission and the Georgia Real Estate Appraiser Board. O.C.G.A. § 48-5-311 (e.1)(2).

If you remain unsatisfied, you may appeal to Superior Court within 30 days of the Board of Equalization or Hearing Officer decision. O.C.G.A. § 48-5-311(g)(2).

Can I seek reimbursement of my attorney fees from the Board of Assessors?

Yes, “[i]f the final determination of value on appeal is 85 percent or less of the valuation set by the county board of equalization, hearing officer, or arbitrator as to any real property, the taxpayer, in addition to the interest provided for in subsection (m) of this Code section, shall recover costs of litigation and reasonable attorney’s fees incurred in the action.” O.C.G.A. § 48-5-311(g)(4)(B)(ii)(III).

If I appeal, can the Board of Assessors raise my assessment again next year?

Generally no, subject to few exceptions. SeeC.G.A. §48-5-299(c), which provides:

When the value of real property is reduced or is unchanged from the value on the initial annual notice of assessment and such valuation is established as the result of either an appeal decision rendered pursuant to Code Section 48-5-311 or stipulated by agreement of the parties to such an appeal that this subsection shall apply in any year, the valuation so established by appeal decision or agreement may not be increased by the board of tax assessors during the next two successive years, subject to the following exceptions:

(1) This subsection shall not apply to a valuation established by an appeal decision if the taxpayer or his or her authorized representative failed to attend the appeal hearing or provide the board of equalization, hearing officer, or arbitrator with some written evidence supporting the taxpayer’s opinion of value;

(2) This subsection shall not apply to a valuation established by an appeal decision or agreement if the taxpayer files a return at a different valuation during the next two successive years;

(3) If the taxpayer files an appeal pursuant to Code Section 48-5-311 during the next two successive years, the board of equalization, hearing officer, or arbitrator may increase or decrease the value of the real property based on the evidence presented by the parties during the appeal process; and

(4) The board of tax assessors may increase or decrease the value of the real property if, after a visual on-site inspection of the property, it is found that there have been substantial additions, deletions, or improvements to such property or that there are errors in the board of tax assessors’ records as to the description or characterization of the property, or the board of tax assessors finds an occurrence of other material factors that substantially affect the current fair market value of such property.

While the exceptions may seem broad, generally the Courts have interpreted the Board of Assessors’ ability to increase assessments for the next two years under O.C.G.A. §48-5-299(c) narrowly.

If I purchased my property last year, can the Board of Assessors assess my property higher than the sale price?

No, if you purchased your property during the last calendar year, it cannot be assessed higher than your sale price. SeeC.G.A 48-5-2(3):

Fair market value of property” means the amount a knowledgeable buyer would pay for the property and a willing seller would accept for the property at an arm’s length, bona fide sale. . . Notwithstanding any other provision of this chapter to the contrary, the transaction amount of the most recent arm’s length, bona fide sale in any year shall be the maximum allowable fair market value for the next taxable year.”

(emphasis added)

Per O.C.G.A. § 48-5-2 (.1) “arm’s length, bona fide sale” means:

a transaction which has occurred in good faith without fraud or deceit carried out by unrelated or unaffiliated parties, as by a willing buyer and a willing seller, each acting in his or her own self-interest, including but not limited to a distress sale, short sale, bank sale, or sale at public auction.